Economic effects of changes in VAT rates in Russia

The subject of the study is the effects of reforming the value added tax. In particular, the authors analyze the economic consequences of an increase in the VAT rate from 18 to 20% in 2020. The following effects are assessed: inflationary, consumer, investment and budgetary. The results are compared with the conclusions obtained earlier by domestic and foreign scientists on the example of developed and developing countries of the world. As research methods, analysis and synthesis, tabular and graphical methods of data visualization, analysis of time series, comparison method, structural and trend analyzes are used. The study contains a number of methodological limitations, which are also consecrated in the work. A special contribution of the authors to the study of the topic is the expansion of the zones of influence of indirect taxation on business and the population. In particular, the authors conclude that despite the presence of a number of negative effects of the increase in the VAT rate for business, nevertheless, such negative effects are most pronounced in relation to the population. They consist in accelerating inflation and reducing consumption in the short term. At the same time, the hypothesis of a significant impact of the VAT rate on investment processes is refuted, which is substantiated by an analysis of the indicators of the investment activity of economic entities in Russia.

tax, VAT, consumption, VAT reform, the tax burden, tax neutrality, tax fairness, tax effects, tax regulation, indirect taxes